2 arrested in alleged foreclosure fraud

Michael D. Henschel of Van Nuys, who has had a long history of legal run-ins, was arrested Thursday by Los Angeles County authorities, who accused him of operating foreclosure scams that took in hundreds of homeowners, costing some their houses.

Henschel, 59, faces 71 federal charges, including forgery and conspiracy counts, in an alleged scheme to defraud homeowners from 2000 to 2004. Canoga Park resident Alan Mitchell, 70, also was arrested and faces 32 charges.

Scammers posing as foreclosure specialists are becoming increasingly common in California, with some blatantly posting fraudulent offers online, said Los Angeles County Sheriff's Det. Chris Christopher, who arrested the pair and has tracked them for years.

"There's so much real estate fraud out there and we're working like crazy, but we're not even putting a dent into it," he said.

Henschel and Mitchell are accused of offering to save homeowners from foreclosure if they paid a monthly consulting fee and transferred part-ownership of the properties -- often to a fictitious entity.

While pretending to renegotiate loans, the pair charged rent to homeowners, Christopher said. The two men would file for bankruptcy protection using phony debt and made-up names to hold off the banks and extend the "rental" period for several months, he said.

After a protracted, expensive process, the banks would reclaim the properties and evict the homeowners anyway, Christopher said. Although only seven victims are mentioned in the complaint, the scheme extended to hundreds of homeowners, he said.

Deputy Dist. Atty. David L. Fleck, listed as a prosecutor in the complaint, did not return calls for comment. It was unclear whether Henschel or Mitchell, who were to be arraigned today, had retained attorneys.Bail was set at $800,000 for Henschel and $400,000 for Mitchell.

William D. Pangburn, a Ventura attorney who has represented several of Henschel's alleged victims, said Henschel was a real estate expert who manipulated bankruptcy courts and "gullible, financially distressed people" for years.

"Mickey's cases never seem to be big enough to get the proper attention," Pangburn said. "They're so hard to unwind, you really have to persevere, and authorities feel like there are bigger fish to fry."

In the past, Henschel has faced a slew of misdemeanor and felony charges and has been convicted at least five times, but he has always managed to dodge prison time.